They claimed to have a deal to buy the Ritz in Piccadilly for £200m, the court heard.

And they claimed they could sell the hotel, which was then valued at £600m, for £250m because of their relationship with Sir Frederick and Sir David Barclay.

Mr Collins, the company secretary of London Allied Plc, and Mr Boerkhoorn were convinced enough to put down a deposit of £1m, the jury heard.

Of the "relationship" between the defendants and the Ritz owners Mr Collins said: "They were all known to each other and that there was a mythical - sorry I shouldn't use that word - there was a rich Irish person who was a partner who had the other contact with them, who I never met or knew the name of.

"Mr Lee, or his Irish partner, was very close to these people. The Irish partner was frequently used, a rich Irish partner."

He added that the defendants also tried to "urge us to move a little quicker" claiming that another party has offered them a higher price.

Mr Collins told the court why they pursued the deal.

"We decided it was an opportunity. We knew that we could get the funds."